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Car Insurance Agencies

Car insurance agencies are all the same, aren't they? One car insurance quote is just as good as another, isn't it?

Not by a long shot. There is a multitude of car insurance agencies out there, and for a good reason. Each agency fills a particular niche in the insurance industry. For example, while most insurance agencies offer a variety of insurances (e.g. auto, home, life), some specialize in just auto insurance.

Some car insurance agencies specialize in particular types of vehicles. For example, some offer specific policies for classic or collectible cars. These vehicles have specific insurance needs because their value increases over time as they become rarer. While many people choose to insure their classic car under a standard insurance policy, it may be cheaper to insure it as a classic car, provided to meet the insurer's requirements (e.g., proper storage, limited mileage etc.)

But if you don't have a specialized vehicle, can't you just go with the first car insurance quote you get? Not necessarily. You'd be amazed at how much premiums can vary, even with the same information given to all companies.

Try it yourself: Enter your ZIP code in the space provided on our home page. Then, pick a company and enter all the information requested about your current car and the people who drive it. Click "submit" or "get quote" and check out the price. Is it exactly the same as your current premium? Chances are, it's not. It may vary by hundreds of dollars.

Why is that? It's because different insurance companies assess risk differently, so it definitely pays to get several quotes. (As you can see, each quote only takes a few minutes, so you can easily get a few on your lunch hour.)

A big part of the variety among car insurance agencies lies in the discounts they offer. For example, an automobile club may offer discounts for its members. An agency that offers several types of insurance will likely offer a discount on a car insurance quote if you also have a home or life insurance policy with the company. Likewise, it makes sense (and cents) to insure all vehicles with the same company for a multi-car discount.

Start with the Basics of Automotive Insurance

Before you consider the variables, you need to start with the basics. All agencies will start by asking for the same information:  The make, model and year of your car; your name, address, age, profession and driving history. The agency will also likely want to know about all the drivers in your household and will likely research their driving records and credit scores.

Some of the variables you will need to consider in your car insurance quote include:

Comprehensive Insurance: How much coverage do you want against vandalism, "Acts of God" and similar events? Your answer will depend on where you live and how much you use your car. It's a good idea to carry some comprehensive insurance because you just never know when the unusual will happen.

Collision coverage: If you drive a relatively new vehicle, you'll want collision insurance to protect your investment if you are involved in an accident. However, if your car is older and is now only worth a few thousand dollars, it may be worthwhile to cancel or greatly reduce collision insurance and put the money you save from your car insurance premium to save toward a newer car when you really need it.

Liability:  Liability insurance covers you in the event of a lawsuit concerning your vehicle. These lawsuits can result from collisions with another vehicle, with pedestrians, uninsured drivers etc. It is best to be prudent and not skimp on liability insurance. One lawsuit can easily deprive you of your life savings if you don't have the right coverage. Many states have requirements as to liability insurance. Most insurance industry experts recommend exceeding those minimums.

Also, be sure your liability coverage is for each injured person rather than total liability. For example $500,000 liability insurance per person provides a lot more coverage than $500,000 total liability.

Time to Play

Most of this information can be determined when you request an online car insurance quote. You can "play" with your quote by raising and lowering your deductible and coverage to get the best rate. When doing so, notice how easy it is to navigate the company's website and to get the information you need, from basic insurance definitions to more specific information about your quote. While this might seem like a small detail, the user-friendliness of the company's website may be an indication of how well it serves its customers. In this day and age, there's no excuse for even neighborhood agencies to not have a user friendly website.

Probably the area in which agencies vary the most is in discounts. Be sure to ask for a list of available discounts and carefully consider whether you qualify for each of them. There are discounts for good students, for drivers who have taken a defensive driving course, for cars with safety and security devices, for members of professional organizations, for people who carpool and even for people who drive hybrid vehicles. New discounts are available seemingly every week.

When comparing car insurance quotes, ask an agency if it offers a discount similar to that offered by another one. It may have been overlooked in the quote process. If an agency does not currently offer a particular discount, chances are it will be offered soon if enough customers ask for it. The insurance industry is very competitive and insurers want to keep their customers coming back.

While getting quotes online is very fast and easy, it's a good idea to contact a local agent before you purchase a policy. It is important to have a good rapport with the agent. After all, this is the person who will be handling your claim. You want to know that he or she has experience in the insurance industry and has your best interests at heart. When you meet the agent ask yourself, "Do I want this person to handle my claim in an emergency situation?" If not, keep looking.

Lastly, before purchasing your policy, check to make sure the company will still be around when you need it. Consult your state insurance bureau, the Better Business Bureau, A.M. Best Company and Standard & Poor's to find out how each rates a particular company. A little extra digging can save you from the heartache of having your insurance provider go out of business.

There's another source of insurance company information that is very helpful but little used: Ask local body shops which car insurance companies they recommend. You'll find that body shops know which ones pay promptly and which ones cause more headaches than the incidents themselves. Also ask your friends, relatives and coworkers who insures their cars and whether they are happy with those companies. It's easy and free to learn from their experience.

The best car insurance agencies are those that truly work toward your best interests:  the fullest coverage possible at the best price for your budget. If you need car insurance, you're well advised to do some thorough research. Fortunately, you can do most of it right now, online.

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